The DUP struck fear into the heart of Theresa May's government last night after the party's MPs threatened to go against the Conservatives in key votes.

The Prime Minister's agreement with the DUP to keep the Tories in power was strained to breaking point after Nigel Dodds called on the Prime Minister to ditch her Brexit plan and "work for a better deal".

Last night, the Government was forced to cave in to a raft of Labour demands to amend the Finance Bill, as it could not rely on DUP votes in the House of Commons. Labour accused Mrs May of being "in office but not in power" and her Government of "falling apart".

It casts doubt on the future of Mrs May's 'confidence and supply' arrangement with the 10 DUP MPs, secured with a controversial £1bn funding deal for Northern Ireland.

Shadow chancellor John McDonnell said: "It's absolutely staggering that the Government has accepted all Labour amendments to the Finance Bill because it couldn't rely upon the DUP's support. The Tories are in office but not in power. We're watching a government falling apart in front of us."

The Government climbdown and unwillingness to force votes came after the DUP voted with Labour once and abstained five times during Finance Bill votes on Monday. Yesterday, Mr Dodds had made clear the DUP was ready to continue voting against the Government and called on Mrs May to dump her exit plan.

The North Belfast MP said: "With the rejection of the Prime Minister's Withdrawal Agreement on all sides of the House and across all parties, it is increasingly clear this deal does not have support necessary to pass the meaningful vote in Parliament. Unionists in Northern Ireland, and indeed unionists across the UK, are appalled at the constitutional implications of the deal."

While the DUP had "kept to our word" on the agreement, the resignation of several Tory ministers showed that Mrs May's deal "does not represent those shared objectives", he said.

He added: "The Government will require DUP support to deliver its domestic agenda. We will continue to use our influence for the good of everyone across the United Kingdom.

"If the Government can look beyond a Withdrawal Agreement, which is uniting people from across the political spectrum against it, and instead work towards a better deal, then an outcome can be delivered that truly works to benefit all parts of the United Kingdom."

Shortly afterwards, the Impartial Reporter, a Co Fermanagh newspaper, reported that leading Brexiteer and former foreign minister Boris Johnson and Chancellor Philip Hammond are due to attend the DUP's conference at the weekend.

And last night, former DUP MP Rev Willie McCrea used his maiden speech in the House of Lords - traditionally reserved for uncontroversial issues - to argue the proposed Withdrawal Agreement would "drive a coach and horses" through devolution.

Lord McCrea of Magherafelt and Cookstown said the draft Brexit deal "threatens the integrity" of the UK.

Speaking in the upper chamber, the veteran politician insisted the draft document was "not a good deal" for the UK and warned his party would reject it.

Lord McCrea said: "If these proposals were implemented, we in Northern Ireland would have to take rules from a body without any representation, governed by laws which even if they damaged our economy could not be changed and which we have no say in. These proposals drive a coach and horses through the devolution settlement and our constitutional practices, to suit the European Union."

But in a move likely to be welcomed by Brexiteers, No.10 confirmed the Government would look at potential technological solutions to keep the Irish border open. Mrs May's spokesman confirmed that references in last week's draft agreement to "alternative arrangements" for the border could involve technical measures of the kind previously promoted as the "maximum facilitation" solution, or Max Fac.

And last night, Independent Unionist MP Lady Sylvia Hermon revealed she had a "constructive and at all times amicable" meeting with the Prime Minister on Monday night over concerns she had about the plan.

"During that meeting I raised a number of issues with her and it was agreed No.10 would let me have written clarification on those points," she said. "In addition, since the constitutional guarantee for Northern Ireland and the consent principle of the Belfast Agreement are already written into the Withdrawal Agreement, I suggested it would be helpful to repeat those in a separate political declaration."

Meanwhile, the Tanaiste has said the draft agreement is not open for renegotiation.

Simon Coveney said it should no longer be considered a draft and that instead it should be seen as the only agreement. Mr Coveney told the Dail that it was "not going to be re-opened".

"This is a text that has been agreed between the negotiations teams, it has been agreed by the British government. So to that extent, it is not a draft text, it is now the text, and it is not going to be reopened," he said.

Mr Coveney said the text should not be changed at this stage because it had taken two years to put together.

"It's sensitive, it's difficult. It's a compromise on both sides, by the UK and the EU, trying to accommodate each other's concerns."

Mrs May is scheduled to travel to Brussels today to meet European Commission president Jean-Claude Juncker ahead of a special EU summit on Sunday.